Osteoclasts are the body's sole bone resorbing cells. Pro-inflammatory T-cells, commonly called effector T-cells (TEFF), produce cytokines that stimulate bone resorption by osteoclasts. Prolonged exposure to the inflammatory cytokines leads to osteoporosis. Normally, regulatory T-cells, TREG, counteract the activity of TEFF. TREG suppress TEFF, suppress inflammation and promote healing. We have recently discovered that osteoclasts can induce a novel class of TREG, belonging to the CD8 lineage. These regulatory CD8+ T-cells, termed TcREG, like the more extensively studied TREG of the CD4 lineage, also express the transcription factor FoxP3. We have demonstrated that TcREG can negatively regulate bone turnover and production of TEFF in a mouse model of postmenopausal osteoporosis. Osteoclasts induce TcREG from naive CD8 T-cells, which then negatively regulate osteoclast numbers and activity, to form a negative feedback loop. TcREG could potentially be very important for maintaining and restoring skeletal and immune homeostasis. We propose, in the application to study the mechanisms underlying the negative feedback loop. We propose to first uncover the mechanism by which osteoclasts induce FoxP3 in CD8 T-cells. Knowledge of these mechanisms could be used to induce TcREG locally to treat chronic inflammation. Second, additional proposed experiments will reveal how TcREG negatively regulate osteoclasts. Insights into how TcREG suppress bone turnover in osteoporosis is likely to lead to new treatment modalities, with relevance to other bone erosion diseases. This approach would represent an entirely new and mechanistically distinct avenue than those currently in use or development.